Preference to the contract system of employment is not unique to the private corporate sector. About 43% of the 28.8 million formal-sector workforce with the central government is either on contract or are casual labourers with virtually no social security cover, a new survey has revealed.

Indian Staffing Federation, the apex body for companies supplying contract labourers to the industry, estimated temporary workers dependent on government at 12.3 million, of which 10.5 million are casual workers engaged in sectors such as mining and construction and are without any formal job contract. Another 1.4 million workers hold fixed short term written job contracts in relatively skilled professions such as teachers in primary and secondary education, office clerks, protective services and personal care.

The percentage of contract or casual workers dependent on the government has shot up to 43% in 2013. The share of contract and casual labourers in the public sector was barely 11.65% in 2009 and 6.4% in 2001 as there has been a sharp decline in share of permanent employees from 93.6% in 2001 to 88.45% in 2009. Employment in the public sector declined from 19.5 million in 1995 to 17.5 million in 2011, with central government accounting for half of the decline.

Out of the 397.4 million workforce in India, an overwhelming majority of 87% (347.7 million) are employed in informal sectors and only 49.7 million are in formal sector. Even among the limited number of formal sector workers, 56% (27.8 million) are holding jobs temporary in nature and most of them are casual (23.8 million).

While National Sample Survey Organisation estimates 7.2 million increase in the formal sector workforce in India from 2011 to 2013, ISF said this large overall figure of expansion in formal workforce though hides an interesting story – more than 40% of the increment involves a transition of informal sector workers into the formal sector. "This expanding formalisation of the workforce in India would have been something to cheer about, unless the finer details showed that almost two-thirds of this incremental formal sector work force hold temporary jobs, with more than 80% of them having no formal work contract," ISF said. "A considerable number of these temporary workers dependent on Government for livelihood are deprived of a decent work environment. A large number do not even receive the minimum wages," it added.

The casual workers hardly have any job or income security. Even the short term